Lawyers could be up for a $2 million payday should a judge approve a $5.5 million settlement in a class action against a pair of suburban Chicago pet insurance companies over robocalls to pet adopters. The settlement would deliver less than $100 to each class member.
Christopher Legg, of Broward County, Fla., filed suit in 2014 against PTZ Insurance and its parent company, PetHealth, both of Rolling Meadows, alleging the companies violated the U.S. Telephone Consumer Protection Act from 2013-2016. Specifically, Legg alleged the companies called pet adopters who had not consented in writing to receive promotional phone calls.
Legg is represented by the Chicago firm of Keogh Law and Scott D. Owens, of Hollywood, Fla.
According to the lawsuit, PetHealth and PTZ offer people who adopt pets, through partnering animal shelters, 30 days of free pet health insurance. As part of the adoption process, court documents said adopters must give their email address and "‘opt-in’ to receiving communications” from the insurers. The adopters are also told their personal information may be shared with third parties, who may contact them for marketing purposes. Legg alleged there was no written agreement to receive calls.
Keith Keogh Keogh Law
PetHealth and PTZ then would send two emails and place two prerecorded robocalls to new adopters, encouraging them to sign up for the pet insurance.
The insurance providers argued the calls caused no harm, as the adopters had agreed to receive marketing communications from third parties.
During the course of litigation, Legg twice tried to have the case certified as a class action, but the judge refused, saying it would be impractical, because each class member and animal shelter worker involved in the adoptions would need to testify.
At any rate, on May 8, Legg presented a preliminary settlement agreement to U.S. District Judge Robert Gettleman in Chicago federal court. Under the deal, defendants would set up a $5.5 million fund, from which to pay claims to about 731,173 people who were called by the pet insurers on their cell phones. Each person submitting a claim is estimated to receive between $46 and $92, according to Legg's filing.
If money remains to pay at least an additional $10 to each class member, the money would be distributed on a pro rata basis. Any leftover funds would be donated to the National Consumer Law Center, to promote the Telephone Consumer Protection Act.
"Not a single penny of the Fund will revert to Defendants," Legg's attorney noted.
Under the settlement's terms, Legg will collect $20,000 for spearheading the suit, which involved flying from his Florida home to Chicago for his deposition, court papers said.
Legg's attorneys are to divide up $2 million, which represents 36 percent of the $5.5 million settlement fund and which they said is the standard percentage given attorneys in such suits in federal district court for northern Illinois.
In arguing for approval of the settlement, Legg expressed confidence he would have won at trial, but nonetheless recognized success would not have come without struggle.
"This action involves sharply opposing positions on many issues and was not resolved until after years of litigation including after this Court twice denied class certification and while the third motion for class certification was pending. Plaintiff and the Settlement Class would face a number of difficult challenges if the litigation were to continue including lengthy appeals if this Court again denied class certification," Legg said.
A status hearing was set for May 15.
PTZ Insurance is defended by SmithAmundsen LLC, of Chicago